Hosting Crowns

Late in 2013 there was a flurry of interest in a project called the “Crown Hosting Service” – covered, for instance, by Bryan Glick at Computer Weekly. The aim, according to the article, was to save some £500m within a few years by reducing the cost of looking after servers.  The ITT for this “explicit legacy procurement” (as Liam Maxwell accurately labelled it) was issued in July 2014.

Apparently some £1.6bn is spent by government on hosting government’s IT estate.  That figure is about half what it costs to run government’s central civil estate (buildings); and that £3bn is only 15% of the cost of running the total estate.  The total cost of running the estate is, then, something like £20bn (with an overall estate value of c£370bn).

It’s interesting, then, to see increasing instances of department’s sharing buildings – the picture below shows two agencies that you might not associate together.  The Intellectual Property Office and the Insolvency Service share a building – though I’m hoping it’s not because they share a customer base and offer a one stop shop.  The IPO and the IS are both part of BIS (which is just around the corner) so perhaps this is a like for like share.

But over the next couple of years, and maybe in the next couple of months, we are certainly going to see more sharing – DCLG will soon vacate its Victoria location and begin sharing with another central government department.  Definitely not like for like.
Such office sharing brings plenty of challenges. At the simpler end things such as standard entry passes and clearance levels.  At a more complicated level is the IT infrastructure – at present something that is usually entirely unique to each department.  A DCLG desktop will not easily plug straight into the network of another department – even a wireless network would need to be told about new devices and where they needed to be pointed at.
With increasing commoditisation of services, and increasing sharing, it’s easily possible to see – from a purely IT point of view – government buildings that function, for large numbers of HQ and, perhaps especially, field staff, as drop in centres where desks are available for whoever is passing provided that they have the right badge.  Those who want to work from home can continue to do so, but will also be able to go to a “local office” where they will have higher bandwidth, better facilities and the opportunity to interact with those in other departments and who run other services.  
In this image, the vertical silos of government departments will be broken up simply because people no longer need to go to “their” department to do their day job, but they can go wherever makes most sense.  Maybe, just maybe, the one stop shop will become a reality because staff can go where the customers are, rather than where their offices are.

The Trouble With Transition – DECC and BIS Go First

In a head-scratching story at the end of last week, DECC and BIS made
the front page of the Financial Times (registered users/subscribers can access the story). 
Given the front page status, you might imagine that the Smart Meter
rollout had gone catastrophically wrong, or that we had mistakenly paid
billions in grants to scientists who weren’t getting the peer reviews
that we wanted, or that we’d suddenly discovered a flaw in our model for
climate change or perhaps that the Technology Strategy Board had made
an investment that would forever banish viruses and malware.

The BBC followed the story too.

But,
no.  Instead we have two departments having problems with their email. 
Several Whitehall wags asked me weeks ago (because, yes, this story has
been known about for a month or more) whether anyone would either
notice, or care, that there was no email coming to or from these
departments.   It is, perhaps, a good question.

Business Secretary Mr Cable and Energy and Climate Change Secretary Mr Davey were reported in the Financial Times
to be angry about slow and intermittent emails and network problems at
their departments since they started migrating to new systems in May.

The real question, though, is what actually is the story here?


It appeared to be a barely-veiled attack on the current policy of
giving more business to SMEs (insider says “in effect they are not
necessarily the best fit for this sort of task” … “an idealistic Tory
policy to shake up Whitehall”)

– Or was it about
splitting up contracts and of taking more responsibility for IT delivery
within departments (Mr Cable seemingly fears the combination of
cost-cutting and small firms could backfire)?

–  Was the story leaked by Fujitsu who are perhaps sore at losing their £19m per annum, 15 year (yes, 15. 15!) contract?

– Was
it really triggered by Ed Davey and Vince Cable complaining to the PM
that their email was running slow (“Prime Minister, we need to stop
everything – don’t make a single decision on IT until we have resolved
the problems with our email”)?

– Is it even vaguely possible that it is some party political spat where the Liberal Democrats, languishing in the polls, have decided that a key area of differentiation is in how they would manage IT contracts in the future?  And that they would go back to big suppliers and single prime contracts?

– Was it the technology people
in the department themselves who wish that they could go back to the
glory days of managing IT with only one supplier when SLAs were always
met and customers radiated delight at the services they were given?

#unacceptable as Chris Chant would have said.

Richard Holway added his view:

In our view, the pendulum has swung too far. The Cabinet Office refers
to legacy ICT contracts as expensive, inflexible and outdated; but
moving away from this style of contract does not necessarily mean moving
away from the large SIs.

And it appears that it is beginning to dawn on
some in UK Government that you can’t do big IT without the big SIs. A
mixed economy approach – involving large and small suppliers – is what’s
needed.

By pendulum, he means that equilibrium sat
with less than a dozen suppliers taking more than 75% of the
government’s £16bn annual spend on IT.  And that this government, by
pushing for SMEs to receive at least 25% of total spend, has somehow
swung us all out of kilter, causing or potentially causing chaos.  Of
course, 25% of spend is just that – a quarter – it doesn’t mean (based
on the procurements carried out so far by the MoJ, the Met Police, DCLG
and other departments) that SIs are not welcome.

Transitions, especially, in IT are always challenging – see my last blog on the topic
(and many before).  DECC and BIS are pretty much first with a change
from the old model (one or two very large prime contracts) to the new
model (several – maybe ten – suppliers with the bulk of the integration
responsibility resting with the customer, even when, as in this case,
another supplier is nominally given integration responsibility).  Others
will be following soon – including departments with 20-30x more users
than DECC and BIS.

Upcoming procurements will be
fiercely competed, by big and small suppliers alike.  What is different
this time is that there won’t be:

–  15 year deals that
leave departments sitting with Windows XP, Office 2002, IE 6 and dozens
of enterprise applications and hardware that is beyond support.

or


15 year deals that leave departments paying for laptops and desktops
that are three generations behind, that can’t access wireless networks,
that can’t be used from different government sites and that take 40
minutes to boot.

or

– 15 year deals
that mean that only now, 7 years after iPhone and 4 years after iPad,
are departments starting to take advantage of truly mobile devices and
services

With shorter contracts, more competition,
access to a wider range of services (through frameworks like G-Cloud),
only good things can happen.   Costs will fall, the rate of change will
increase and users in departments will increasingly see the kind of IT
that they have at home (and maybe they’ll even get to use some of the
same kind of tools, devices and services).

To the
specific problem at BIS and DECC then.  I know little about what the
actual problem is or was, so this is just speculation:


We know that, one day, the old email/network/whatever service was
switched off and a new one, provided by several new suppliers, was
turned on.  We don’t know how many suppliers – my guess is a couple, at
least one of which is an internal trading fund of government. But most
likely not 5 or 10 suppliers.

– We also know that
transitions are rarely carried out as big bang moves.  It’s not a
sensible way to do it – and goodness knows government has learned the
perils of big bang enough times over the last 15 years (coincidentally
the duration of the Fujitsu contract).

– But what
triggered the transition?  Of course a new contract had been signed, but
why transition at the time they did?  Had the old contract expired? 
Was there a drive to reduce costs, something that could only be
triggered by the transition?   

– Who carried the
responsibility for testing?  What was tested?  Was it properly tested? 
Who said “that’s it, we’ve done enough testing, let’s go”?  There is,
usually, only one entity that can say that – and that’s the government
department.  All the more so in this time of increased accountability
falling to the customer.

– When someone said “let’s
go”, was there an understanding that things would be bumpy?  Was there a
risk register entry, flashing at least amber and maybe red, that said
“testing has been insufficient”?

In this golden age of
transparency, it would be good if DECC and BIS declared – at least to
their peer departments – what had gone wrong so that the lessons can be
learned.  But my feeling is that the lessons will be all too clear:

– Accountability lies with the customer.  Make decisions knowing that the comeback will be to you.

– Transition will be bumpy.  Practice it, do dry runs, migrate small numbers of users before migrating many.


Prepare your users for problems, over-communicate about what is
happening.  Step up your support processes around the transition
period(s).

– Bring all of your supply chain together
and step through how key processes and scenarios will work including
when it all goes wrong.

– Have backout processes that you have tested and know the criteria you will use to put them into action

Transitions
don’t come along very often.  The last one DECC and BIS did seems to
have been 15 years ago (recognising that DECC was within Defra and even
MAFF back then).  They take practice.  Even moving from big firm A to
big firm B.  Even moving from Exchange version x to Exchange version y.

What
this story isn’t, in any way, is a signal that there is something wrong
with the current policy of disaggregating contracts, of bringing in new
players (small and large) and of reducing the cost of IT).

The challenge ahead is definitely high on the ambition scale – many large scale IT contracts were signed at roughly the same time, a decade or more ago, and are expiring over the next 8 months.  Government departments will find that they are, as one, procuring, transitioning and going live with multiple new providers.  They will be competing for talent in a market where, with the economy growing, there is already plenty of competition.  Suppliers will be evaluating which contracts to bid for and where they, too, can find the people they need – and will be looking for much the same talent as the government departments are.  There are interesting times ahead.

There will be more stories about transition, and how hard it is, from
here on in.  What angle the reporting takes in the future will be quite fascinating.